Nike, Inc., mounted a public relations campaign in order to refute news media al

Question

Nike, Inc., mounted a public relations campaign in order to refute news media allegations that its labor practices overseas were unfair and unlawful. The campaign involved the use of press releases, letters to newspapers, a letter to university presidents and athletic directors, and full-page advertisements in leading newspapers. Relying on California statutes designed to curb false and misleading advertising and other forms of unfair competition, California resident Mark Kasky fi led suit in a California court on behalf of the general public of the state. Kasky contended that Nike had made false statements in its campaign and that the court should therefore grant the legal relief contemplated by the California statutes. In terms of Nike’s potential liability, why would it make a difference whether the speech in which Nike engaged was commercial or, instead, noncommercial? What are the arguments in favor of a conclusion that Nike was engaged in commercial speech? What are the arguments in favor of a conclusion that Nike was engaged in noncommercial speech? How did the court rule on the speech classifi cation issue—i.e., whether Nike’s speech was commercial or, instead, that is noncommercial?

Explanation / Answer

1. Commercial advertisement is an advertisement which promotes the products and services of an organization. It informs the customer about the services and the products that the organization exhibits. It takes the information or messages about the product to the customer and enables the organization to build customer trust and loyalty. It is considered as the way of communication about the organization’s existence or about the organization to the public. The means of communication would be TV, social media, banners etc.

The non commercial advertisement may not be related to selling any product or service. It is regarding the process of educating the customers or the public about the company, or the product. It can be a public service announcements or testimonials which generate some awareness in the mind o the customers.

When considering the case of the Nike it has made some efforts to prove that the information which has got shared about their overseas labor practices is false and they are practicing a good practice abroad. For that they have made use the formal press release, sending letters to newspapers etc which can be considered as the non commercial activities. Their intention is not to sell any product through their campaign, instead their intention is to prove themselves good.

2. When the argument of the Nike’s campaign is considered in terms of a commercial speech the following conclusions can be derived.

They have generated a public awareness in the state of California regarding their genuinely in their business practices. This awareness can be related to the public relations which is the most important tool in the marketing process. Through proving their side right through their campaign program a positive image can be generated in the mid of the customers and hence good competitive advantage. Hence it can be argued that it is a commercial advertisement.

3. The organization utilized the Medias like the press release, letters to the newspapers etc for highlighting their operational credibility. They haven’t used any marketing messages or shared any information regarding their products in their campaign. Hence it can be argued that is a non commercial advertisement.

4. Considering the discussions about the classification of the practice of Nike wheather it is commercial or non commercial the court can conclude the decision with the non commercial advertisement since it is not a promotional advertisement.

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